The Stock Market

[badge]

It is even easier to state the obvious after the fact Alex

For a chap who consistantly extols making calls BEFORE the event, its a shame you didnt identify the lows you refer to BEFORE hand.

Congratulations however on successfully calling the lows retest BEFORE hand though

Well - I don't really have a target - I will see when the direction changes again - BEFORE it changes.

I agree we probably will have to revisit the lows before we can have a substantial move up. But for right now - I see the direction as up.

[...]

Third time lucky?

[badge]

Im still using Fridays equity lows as key(natch).

I read people suggesting Stocks Market are 'at a crossroads', well they're always at a crossroads. Always ambiguous.

Ordo Ab Chao.

[midas]

2010-05-21

Well - I don't really have a target - I will see when the direction changes again - BEFORE it changes.

I agree we probably will have to revisit the lows before we can have a substantial move up. But for right now - I see the direction as up.

No worries, it's the "Parvis" cycle........

NO NO NO ..........dont do it people ............Sell sell sell.....my dartboard told me

[lannarebirth]

Im still using Fridays equity lows as key(natch).

I read people suggesting Stocks Market are 'at a crossroads', well they're always at a crossroads. Always ambiguous.

Ordo Ab Chao.

If strong hands have been stopped out, and I think they have, what do they need to want to become buyers again? They bought the lows last time, do you think they want to buy the highs this time. They'll take it to where there's a reasonable chance of a reasonable profit. 20% or greater correction is my guess.

No negative divergances in $USD this time, as there were in last years run. It's extended but looks like there may be more up in store.

[Parvis]

It is even easier to state the obvious after the fact Alex

For a chap who consistantly extols making calls BEFORE the event, its a shame you didnt identify the lows you refer to BEFORE hand.

Congratulations however on successfully calling the lows retest BEFORE hand though

Well - I don't really have a target - I will see when the direction changes again - BEFORE it changes.

I agree we probably will have to revisit the lows before we can have a substantial move up. But for right now - I see the direction as up.

[...]

Third time lucky?

Badge - as always I do not CALL SPECIFIC Lows or Highs - but this time around it would be much easier to call a specific low - but I don't publicise it

Edited May 25, 2010 by Parvis

[midas]

Badge - as always I do not CALL SPECIFIC Lows or Highs - but this time around it would be much easier to call a specific low - but I don't publicise it

so why exactly are you being a masochist in this thread ?

are you intending to offer this " system of trading " for sale eventually ?

[badge]

Badge - as always I do not CALL SPECIFIC Lows or Highs - but this time around it would be much easier to call a specific low - but I don't publicise it

Good for you Parvis. I always suspected that if you didnt publicise any of your 'calls' BEFORE hand, they would be much easier and more accurate.

Bonne chance monsieur.

[Parvis]

Midas

"What is my agenda - that is the question"

Well - first of all - I have an "Audience" here - that does not hesitate to criticize. This criticism helps me to be more specific - without "needing to explain". If criticism increases - therefore obviously - I still have work to do.

One can "fall in love" with ones "squiggly lines" (especially if they tend to be "quite original") and therefore be removed from reality.

Will I ever be willing to sell? Hardly - not likely - absolutely not - no way - comes to my mind. But I may "disclose it all" in my "memoirs" - sooner or later.

Edited May 25, 2010 by Parvis

[badge]

Im still using Fridays equity lows as key(natch).

I read people suggesting Stocks Market are 'at a crossroads', well they're always at a crossroads. Always ambiguous.

Ordo Ab Chao.

If strong hands have been stopped out, and I think they have, what do they need to want to become buyers again? They bought the lows last time, do you think they want to buy the highs this time. They'll take it to where there's a reasonable chance of a reasonable profit. 20% or greater correction is my guess.

No negative divergances in $USD this time, as there were in last years run. It's extended but looks like there may be more up in store.

I couldnt possibly comment on strong or weak hands in the stock market, but as the lows from last friday were broken on European indices today I re-shorted, but have since covered for peanuts as they approached levels my model shows offer support.

Eventually I suspect stock markets will go lower - theyre already retesting todays lows in Europe as I type - but Im content having got out Friday as that was my plan. I like to plan my trades and trade my plans, and leaving 3%/4%/5% etc to the next man is fine. Having taken 15% from the UKs FTSE for example I dont want to push my luck!

Totally agree re: USDX as per comments on 'Is USD Collapse' thread; naturally there will be corrections along the way, but still long and strong.

[AlexLah]

It is even easier to state the obvious after the fact Alex

Aaaaaaaaare you sjuuuuuuuuuuuuwah?

Do I have to rub that smelly sock in yur face again?

[Naam]

[midas]

Midas

"What is my agenda - that is the question"

Well - first of all - I have an "Audience" here - that does not hesitate to criticize. This criticism helps me to be more specific - without "needing to explain". If criticism increases - therefore obviously - I still have work to do.

One can "fall in love" with ones "squiggly lines" (especially if they tend to be "quite original") and therefore be removed from reality.

Will I ever be willing to sell? Hardly - not likely - absolutely not - no way - comes to my mind. But I may "disclose it all" in my "memoirs" - sooner or later.

i think you are just smoking something

[lannarebirth]

It is even easier to state the obvious after the fact Alex

Aaaaaaaaare you sjuuuuuuuuuuuuwah?

Do I have to rub that smelly sock in yur face again?

Now don't gloat Alex. The successful prognosticator will show a certain humility, otherwise it looks as though he is as surprised at his being correct as everyone else.

[AlexLah]

I know lah, we are just having a bit of fun. Looking at all the crap that is happening around us doesn't make me smile.

Will try and find a nice picture.....

[badge]

Alex - Apologies but I must have missed your entries. What has been your prediction?

[AlexLah]

Most if not all are signalling (significant) moves down in the Dow. As I pack "The message" in a picture with a meaning you have to do some (crazy) open minded brainstorming to figure it out. Let me try to say it differently. The "date" I get from previous experiences have been large moves down in the Dow, I dunno why only down, maybe because it is the DOW(n) getting down?

Maybe this should be in the outside the box subforum?

Anyways a while back I posted this (signal) picture.

You see the 3 on the top of the second cross, 3+2=5 So the message says: The 3rd of the 5th is the top and from there it goes down as the third cross indicates as it is lower.

Look what happened:

On 5-05 I posted this picture (post #1698)

You had to do a bot of Googling to find out.

Does it make sense now?

Cool isn't it?

[Abrak]

I know that macro fundamentals are not really popular on this thread but here is how I perceive perception.

Back in say April or May (possibly even March for the smart guys) last year it became pretty clear that there was going to be a bounce in economic fundamentals. Remember those 'green shoots'. Now in the early days there was no evidence of 'green shoots' but it didnt worry the guy who believed in them. Although figures were getting worse he knew they would get better.

This was because (1) the destocking cycle must end (2) long downturns also delay demand rather than simply irradicate it and (3) well 'fiscal stimulus' at the very least had to stop things going down. When say US car sales get down to 9m annualized you can guarantee that they will eventually go up from that level at some point even if they go down first.

So to me there was a 'greenshoots' debate even on this thread that went on forever. To me, a 'bounce' or 'recovery' was signed sealed and delivered at the end of November. We then went into 'what's next phase?', we are probably still there, the market made further gains because the 'rebound'/recovery exceeded expectations (but still the question was whether it was a 'sustained recovery' or a 'strong rebound'.

There are many lead economic indicators but often the stockmarket is the best one. I think the answer to what is next is that we are heading back down.

Now to be clear on this, most economic numbers in general, imply otherwise - we are still in the exceeding expectations rather than falling short. We still really see more momentum to recovery than a real downturn - particularly in the US and Japan.

But if I look for brown shoots I can see them....

1) First of all the restocking cycle has peaked. Second the fiscal stimulus is more likely to be withdrawn than increased and after a long downturn repressed demand that appears to be simply that.

2) There really are no good medium term signs.

For instance, the USA looks the most robust on numbers but car sales have bounced to 11.5m annualized, that is not growth, it needs a lot more to get to 15m-16m it was before. Whether the US ends up in the austerity camp I have no idea but deficits aint going up.

China has certainly exceeded all my expectation but look at money supply figures the are falling. They like most of SE Asia have seen a huge rebound due to restocking. 12% yoy growth Q1 for Thailand is actually the equivalent of 4% total 2 year growth.

Europe seems on a deflation path. Unless Germany inflates (which it seems to hate as much as it loves the Euro) things are pretty much bound to go from bad to worse.

SE Asia is simply peaking. The numbers will deteriorate unless the US recovery continues to maintain its momentum.

And given the appreciating dollar the odds are against that.

Ultimately, I think that we all sort of realize that interest rates cannot go down and fiscal stimulus cannot be increased. If you look to next year it is very difficult to see where growth of any sort will come from.

The point being within three or four months economic numbers will trail off. By say 1Q next year there is every possibility of a return to recession. And if it isnt caused by real economics, some countries are calling themselves in that direction. Deflation is not the way to go.

Or maybe I am simply over complicating my argument. On Monday there was a 3% fall in the Thai stockmarket after announcing 12% growth (ahead of expectations). So good news is going nowhere and bad news is not taken well.

Edited May 25, 2010 by Abrak

[badge]

Most if not all are signalling (significant) moves down in the Dow. As I pack "The message" in a picture with a meaning you have to do some (crazy) open minded brainstorming to figure it out. Let me try to say it differently. The "date" I get from previous experiences have been large moves down in the Dow, I dunno why only down, maybe because it is the DOW(n) getting down?

Maybe this should be in the outside the box subforum?

Anyways a while back I posted this (signal) picture.

You see the 3 on the top of the second cross, 3+2=5 So the message says: The 3rd of the 5th is the top and from there it goes down as the third cross indicates as it is lower.

Look what happened:

On 5-05 I posted this picture (post #1698)

You had to do a bot of Googling to find out.

Does it make sense now?

Cool isn't it?

I somehow wish I had'nt asked.

Your aware that the DOW topped on 26-04?

I suppose there was that enormous 'flash crash' on 6-05, but today is just another day? And tomorrow?

The 'clues' are a little tenuous too.

[12DrinkMore]

I know that macro fundamentals are not really popular on this thread but here is how I perceive perception.

Back in say April or May (possibly even March for the smart guys) last year it became pretty clear that there was going to be a bounce in economic fundamentals. Remember those 'green shoots'. Now in the early days there was no evidence of 'green shoots' but it didnt worry the guy who believed in them. Although figures were getting worse he knew they would get better.

This was because (1) the destocking cycle must end (2) long downturns also delay demand rather than simply irradicate it and (3) well 'fiscal stimulus' at the very least had to stop things going down. When say US car sales get down to 9m annualized you can guarantee that they will eventually go up from that level at some point even if they go down first.

So to me there was a 'greenshoots' debate even on this thread that went on forever. To me, a 'bounce' or 'recovery' was signed sealed and delivered at the end of November. We then went into 'what's next phase?', we are probably still there, the market made further gains because the 'rebound'/recovery exceeded expectations (but still the question was whether it was a 'sustained recovery' or a 'strong rebound'.

There are many lead economic indicators but often the stockmarket is the best one. I think the answer to what is next is that we are heading back down.

Now to be clear on this, most economic numbers in general, imply otherwise - we are still in the exceeding expectations rather than falling short. We still really see more momentum to recovery than a real downturn - particularly in the US and Japan.

But if I look for brown shoots I can see them....

1) First of all the restocking cycle has peaked. Second the fiscal stimulus is more likely to be withdrawn than increased and after a long downturn repressed demand that appears to be simply that.

2) There really are no good medium term signs.

For instance, the USA looks the most robust on numbers but car sales have bounced to 11.5m annualized, that is not growth, it needs a lot more to get to 15m-16m it was before. Whether the US ends up in the austerity camp I have no idea but deficits aint going up.

China has certainly exceeded all my expectation but look at money supply figures the are falling. They like most of SE Asia have seen a huge rebound due to restocking. 12% yoy growth Q1 for Thailand is actually the equivalent of 4% total 2 year growth.

Europe seems on a deflation path. Unless Germany inflates (which it seems to hate as much as it loves the Euro) things are pretty much bound to go from bad to worse.

SE Asia is simply peaking. The numbers will deteriorate unless the US recovery continues to maintain its momentum.

And given the appreciating dollar the odds are against that.

Ultimately, I think that we all sort of realize that interest rates cannot go down and fiscal stimulus cannot be increased. If you look to next year it is very difficult to see where growth of any sort will come from.

The point being within three or four months economic numbers will trail off. By say 1Q next year there is every possibility of a return to recession. And if it isnt caused by real economics, some countries are calling themselves in that direction. Deflation is not the way to go.

Aah Abrak, I really do like your posts.

In the beginning you hit us with some complex stuff, but now you have toned it down so even I can understand.

I still am optimistic that growth will come from the developing countries here in Asia. But this will not help the Europeans or the US. Nobody in the west is prepared to admit that the Asians are going to improve their standard of living and the West has to sit by and pay the dam_n debts off whether that means the Great Austerity Deflation Drive or, when they get sick of that, the Great Inflation Drive I don't know, probably a mixture.

The outcome is surely that the countries which manufacture and produce stuff will prosper and the debtors and consuming nations will feel a substantial decline in their standard of living. Sounds logical and fair to me.

"I am a European and therefore wealthier and superior" sounds sort of hollow when you substitute "debtor" and "inferior".

[Abrak]

I still am optimistic that growth will come from the developing countries here in Asia.

I fully understand your point and I have in threads been overly pessimistic about say China. But this is the point - if there was no growth in real GDP for Thailand for the next 3Qs, QOQ, annual growth would be 8.2%. Now forecasts are around 3-5% but other have said the economy 'would' have grown at 7-8% without the problems. The recovery is there in the numbers and the future is 'uncertain'.

My point being is that Asia has been a significant stimulus to recovery both in terms of actual numbers and momentum. That is bound to change because of their very high exposure to the restocking cycle. In other words, growth will continue to in Asia but (1) it will after 3 months stop exceeding expectations and (2) provide further stimulus and (3) might be vulnerable to its exports markets.

To me if you look at the Euro is simply not a good idea or concept - it is dysfunctional. To me Greece pegging its currency against the Euro is inherently silly. Ultimately the ability for China to peg its currency against the dollar is (I would argue inherently silly) but is at least dysfunctional.

Just imagine two people who could do the same things but one is poor and the other is rich.What happens is that the rich person stops working and gives money to the poor person to produce the same goods. Theoretically the poor person earns as much as the rich person and he goes back to work.) But if the poor person hoards this rich guys cash, he simply doesnt work and produces more debt. At some point, the poor person has to recognize that he doesnt either have a customer and his payments are worthless.

So the inherent relationship of surplus verses, deficit nations is subject to increasing laws of diminishing returns and ultimately is mutually destructive. (Very simply if you have a 10% surplus financed by lending to your customer who exactly is subsidizing who?)

Edited May 25, 2010 by Abrak

[Abrak]

By the way my investments thoughts are largely driven by this...

Cash is an incredibly unattractive investment because (1) interest rates will not go lower and (2) most Governments are trying their hardest to devalue it. In fact it is hard to think of any time that cash is such a pathetic thing to hold.

Still I have a lot of cash at the moment simply on that basis. If cash is such an underlying bad investment based on its very simple fundamentals then every other asset (which implies a degree of risk) must be maximum priced or overpriced.

I agree this is not a very sophisticated theory but it is not that inherently illogical. Of course there are better opportunities out there, I am sure, but 'unattractiveness' of cash I do not believe should be read as an indicator you should spend it.

[Parvis]

Edited May 26, 2010 by Parvis

[Naam]

Cash is an incredibly unattractive investment because (1) interest rates will not go lower and (2) most Governments are trying their hardest to devalue it. In fact it is hard to think of any time that cash is such a pathetic thing to hold.

if one has cash in abundance then cash is in my [not so] humble view the most attractive asset to hold. that goes for any situation and even at zero yield and high inflation. as far as the definition of "abundance" is concerned, individual mileages may of course vary.

[midas]

So to me there was a 'greenshoots' debate even on this thread that went on forever. To me, a 'bounce' or 'recovery' was signed sealed and delivered at the end of November. We then went into 'what's next phase?', we are probably still there, the market made further gains because the 'rebound'/recovery exceeded expectations (but still the question was whether it was a 'sustained recovery' or a 'strong rebound'.

There are many lead economic indicators but often the stockmarket is the best one. I think the answer to what is next is that we are heading back down.

Now to be clear on this, most economic numbers in general, imply otherwise - we are still in the exceeding expectations rather than falling short . We still really see more momentum to recovery than a real downturn - particularly in the US and Japan.

For instance, the USA looks the most robust on numbers but car sales have bounced to 11.5m annualized, that is not growth, it needs a lot more to get to 15m-16m it was before. Whether the US ends up in the austerity camp I have no idea but deficits aint going up.

SE Asia is simply peaking. The numbers will deteriorate unless the US recovery continues to maintain its momentum.

But why does the MSM only seem to emphasise " green shoots ", " stock market movements " , " car sales " ?

An attempt to brainswash the sheeple .

Let us remember USA relied on consumers ( 70% of GDP ) and those consumers were only active before the Crisis

because they used their homes as piggy banks. They spent because they felt wealthy.

But if you read this excellent explanation with easy to understand statistics its clear why its IMPOSSIBLE for the US housing

market to recover quickly ( they say 10 years ) and so without stimulus this current activity cannot last.

And why doesnt the MSM ever talk about this ?

Anyone Who Is Still Bullish On Housing Clearly Isn't Paying Attention To The Real Numbers

http://www.businessinsider.com/anyone-whos...5#ixzz0p0qNw4qd

[badge]

By the way my investments thoughts are largely driven by this...

Cash is an incredibly unattractive investment because (1) interest rates will not go lower and (2) most Governments are trying their hardest to devalue it. In fact it is hard to think of any time that cash is such a pathetic thing to hold.

Still I have a lot of cash at the moment simply on that basis. If cash is such an underlying bad investment based on its very simple fundamentals then every other asset (which implies a degree of risk) must be maximum priced or overpriced.

I agree this is not a very sophisticated theory but it is not that inherently illogical. Of course there are better opportunities out there, I am sure, but 'unattractiveness' of cash I do not believe should be read as an indicator you should spend it.

Of the(few, admittedly) markets that I follow, larger sovereign bonds have had a fabulously stellar run of late(TBonds, Bunds, Gilts), especially TBonds, if your not an investor denominated in USD.

A certain degree of market timing is required of course.

No advice intended!

[badge]

This post has been edited by Parvis: Today, 2010-05-26 08:24:00

The first of your 'unpublicised' market insights, from BEFORE the fact?

[Abrak]

Cash is an incredibly unattractive investment because (1) interest rates will not go lower and (2) most Governments are trying their hardest to devalue it. In fact it is hard to think of any time that cash is such a pathetic thing to hold.

if one has cash in abundance then cash is in my [not so] humble view the most attractive asset to hold. that goes for any situation and even at zero yield and high inflation. as far as the definition of "abundance" is concerned, individual mileages may of course vary.

Sadly, in my case, 'abundance' merely means 'unusually high amounts' relatively to my total assets rather than an asset portfolio that you can effectively say '<removed> you' to risk.

I have also had a spectacular (but which I mean incredibly lucky) start to the year, whereby even 0% for the remains of it, will still allow me to toast the next New Year as me being the unacceptable face of capitalism.

[lannarebirth]

So to me there was a 'greenshoots' debate even on this thread that went on forever. To me, a 'bounce' or 'recovery' was signed sealed and delivered at the end of November. We then went into 'what's next phase?', we are probably still there, the market made further gains because the 'rebound'/recovery exceeded expectations (but still the question was whether it was a 'sustained recovery' or a 'strong rebound'.

There are many lead economic indicators but often the stockmarket is the best one. I think the answer to what is next is that we are heading back down.

Now to be clear on this, most economic numbers in general, imply otherwise - we are still in the exceeding expectations rather than falling short . We still really see more momentum to recovery than a real downturn - particularly in the US and Japan.

For instance, the USA looks the most robust on numbers but car sales have bounced to 11.5m annualized, that is not growth, it needs a lot more to get to 15m-16m it was before. Whether the US ends up in the austerity camp I have no idea but deficits aint going up.

SE Asia is simply peaking. The numbers will deteriorate unless the US recovery continues to maintain its momentum.

But why does the MSM only seem to emphasise " green shoots ", " stock market movements " , " car sales " ?

An attempt to brainswash the sheeple .

Let us remember USA relied on consumers ( 70% of GDP ) and those consumers were only active before the Crisis

because they used their homes as piggy banks. They spent because they felt wealthy.

But if you read this excellent explanation with easy to understand statistics its clear why its IMPOSSIBLE for the US housing

market to recover quickly ( they say 10 years ) and so without stimulus this current activity cannot last.

And why doesnt the MSM ever talk about this ?

Anyone Who Is Still Bullish On Housing Clearly Isn't Paying Attention To The Real Numbers

http://www.businessinsider.com/anyone-whos...5#ixzz0p0qNw4qd

Because the guy writing the copy and the guy reading the news more tha likely works for one of a half dozen multi-national media organizations and a large part of the remuneration he receives will be in the stock or stock options of that corporation. In this era where "everbody's in", there is absolutely no taste or market for realistic financial journalism. The delusion of crowds and the creation of financial manias is the worlds most profitable business.

[Abrak]

Let us remember USA relied on consumers ( 70% of GDP ) and those consumers were only active before the Crisis

because they used their homes as piggy banks. They spent because they felt wealthy.

The rather strange thing is how robust the US Consumer seems to be. ('Robust' meaning anything from silly, stupid, optimistic, or whatever.)

One rather strange statistic in the US is that the savings rate has been falling consistently from a 'massive' 4% of GDP down to 2.7%. (Personally I think it should be well over 10%.) Now that is back to levels of say 2005.

This to me seems very surprising.

My 'guess' as to why this is, is that consumers are spending latent demand built up during the recession. It is a temporary factor that is boosting GDP in the short term.

[midas]

So to me there was a 'greenshoots' debate even on this thread that went on forever. To me, a 'bounce' or 'recovery' was signed sealed and delivered at the end of November. We then went into 'what's next phase?', we are probably still there, the market made further gains because the 'rebound'/recovery exceeded expectations (but still the question was whether it was a 'sustained recovery' or a 'strong rebound'.

There are many lead economic indicators but often the stockmarket is the best one. I think the answer to what is next is that we are heading back down.

Now to be clear on this, most economic numbers in general, imply otherwise - we are still in the exceeding expectations rather than falling short . We still really see more momentum to recovery than a real downturn - particularly in the US and Japan.

For instance, the USA looks the most robust on numbers but car sales have bounced to 11.5m annualized, that is not growth, it needs a lot more to get to 15m-16m it was before. Whether the US ends up in the austerity camp I have no idea but deficits aint going up.

SE Asia is simply peaking. The numbers will deteriorate unless the US recovery continues to maintain its momentum.

But why does the MSM only seem to emphasise " green shoots ", " stock market movements " , " car sales " ?

An attempt to brainswash the sheeple .

Let us remember USA relied on consumers ( 70% of GDP ) and those consumers were only active before the Crisis

because they used their homes as piggy banks. They spent because they felt wealthy.

But if you read this excellent explanation with easy to understand statistics its clear why its IMPOSSIBLE for the US housing

market to recover quickly ( they say 10 years ) and so without stimulus this current activity cannot last.

And why doesnt the MSM ever talk about this ?

Anyone Who Is Still Bullish On Housing Clearly Isn't Paying Attention To The Real Numbers

http://www.businessinsider.com/anyone-whos...5#ixzz0p0qNw4qd

Because the guy writing the copy and the guy reading the news more tha likely works for one of a half dozen multi-national media organizations and a large part of the remuneration he receives will be in the stock or stock options of that corporation. In this era where "everbody's in", there is absolutely no taste or market for realistic financial journalism. The delusion of crowds and the creation of financial manias is the worlds most profitable business.

yes.... just keep the sheeple focusing on one small spot and TPTB can get away with murder

Did you hear they are considering another new stimulus .....$ 5 Trillion this time.

There has to be another bigger " agenda " because nothing else would explain this lunacy

Edited May 26, 2010 by midas